Clarification on Exemption on export of goods via Notification No.29/2005 Dt. 15/7/205

[Guest]

Dear Sir, In view of service tax Notification No. 29/2005 dt.. 15/7/205 does freight charges on all export of goods via aircraft are exempt from service tax? Or is this exemption available only if goods are sent only through aircraft operators and not courier services like DHL. Although litreal interpretation of the circular leads to this interpretation only, however it does not appear to have any logic of this interpretation. with regards, Manish Poddar B.Com, A.C.A.

[Ravi Chopra]

The notification referred by exempts the services referred under sub clause (zzn) of clause 105 of section 65. Therefore, only transport of goods by air are eligible for exemption. Thereis no scope to interpretation as you pointed out.

 

AI Summary

Exemption for air transport: freight for carriage by air qualifies for service tax relief, courier services excluded. The exemption under Notification No.29/2005 applies exclusively to transport of goods by air; services provided by courier operators do not fall within that description and therefore do not qualify for the exemption.